Cryptoupdated 1h ago2 min read
FBI Blames North Korea’s TraderTraitor for Binance $6.3 Billion Hack
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FBI attributes the $6.3 billion Binance hack to North Korea's TraderTraitor. Blockchain firms TRM Labs and Chainalysis link TraderTraitor to North Korea.
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FBI points to TraderTraitor
The FBI said North Korean hackers orchestrated the theft of billions of dollars from Binance within a matter of minutes, calling it the biggest crypto heist in history. The FBI tied the attack to “malicious cyber activity” by an entity known as TraderTraitor, and the FBI said TraderTraitor was the same actors behind a $1.5 billion Bybit hack last year. The FBI asked crypto exchanges and blockchain analytics companies to block transactions linked to various addresses to make sure the money is not laundered to cover up its origins.
“The FBI expects that TraderTraitor will now attempt to convert the assets using DeFi and ‘instant swap services.’”
The FBI said its probe found that TraderTraitor was converting stolen assets primarily into a cryptocurrency called ethereum, and the FBI expected TraderTraitor to attempt to convert the assets using DeFi and “instant swap services.” President Donald Trump told reporters at a Halloween party at his Mar-a-Lago estate in Florida, “We don’t know if it’s North Korea.”
Binance covers losses
Binance said it replaced 90% of the amount stolen after a record $6.3bn hack of its platform, and Binance said the remaining 10% of tokens were less liquid. Binance co-CEO Richard Teng said Binance was “committed to covering the remaining 10%” and that “users will not bear the financial impact of this incident”. Binance suspended user withdrawals after the hack, and Binance said it was on track to resume them on Sunday.
Binance said it had set aside around $6.34bn of company funds to cover the losses, and Binance said it would fully cover the financial impact of the funds stolen. The FBI also urged private sector entities “to block transactions with or derived from addresses TraderTraitor actors are using to launder these stolen assets”.
Laundering, tracing, and next steps
Crypto expert Ari Redbord said he expected the hackers would break the stolen assets into pieces and try to launder them through smaller exchanges to evade detection. Redbord described the situation as “It’s bank robbery, in this case, at the speed of the Internet,” and he said investigators could “track and trace those funds in real time in order to build investigations, to disrupt and to seize back funds.” Binance said it replenished the stolen assets using company money to buy new tokens, and Binance said the remaining 10% consisted of tokens that were less liquid.
The FBI said it observed “TraderTraitor actors” converting stolen assets into Ethereum, and the FBI expected further laundering through decentralised finance and instant swap services. The BBC reported that Binance said it remained on track to reopen withdrawals on Sunday 1 November and would provide a further update once details were confirmed.